Finance ministers from the world’s top seven industrialised (G7) nations who wound up their two-day informal chats in the Canadian Arctic city of Iqaluit admitted Saturday that the recovery from the global recession is still weak.
Though there was no formal communique at the end of the 24-hour gathering, the finance ministers and central bank heads from the US, Canada, Italy, France, Britain, Germany and Japan said the worst was over for the global economy.
Expressing cautious optimism over the recovery, they said their governments would continue with stimulus spending to speed up the recovery process.
Canadian Finance Minister Jim Flaherty, who hosted the meeting, said there are signs that the worst is over for the global economy, but the recovery process is still not firmly established yet.
Reading a statement on behalf of the G7 finance ministers, Flaherty said, “The global economic situation has of course improved and is improving. We do not have firmly established recovery yet but there are good signs.
“We need to continue to deliver the stimulus to which we are mutually committed and begin to look ahead to exit strategies and move to a more sustainable fiscal track consistent with continued recovery.”
They said their strategies to get out of the economic crisis were paying off and committed themselves to avoiding such crises in the future.
The meeting started Friday with a working dinner on the global economic crisis, followed by a fireside chat on the recovery process.
The finance ministers discussed financial sector reforms and efforts by G7 nations to address the underlying causes of the financial crisis.
Later, they held a session on ‘Framework for Strong, Sustainable and Balanced Growth,’ endorsed by the G20 summit in Pittsburgh last year.
Before the start of the meeting, the host Canadian finance minister had said that “the G7 cannot play the role it once did, but it can and it must continue to lead by example in whatever role it will play in the future.
“The first responders to the recent crisis were G7 members....The group’s role in preventing the next crisis must be just as determined, with benefits that go far beyond G7 members themselves. The G7 will continue to evolve in an ever-changing world, while contributing to a more stable and prosperous world for all.’’
But the discussion of the global crisis without involving the emerging economies - China, India and Brazil - came in for criticism in the local media.
“At a time when countries such as China, India and Brazil factor in the effective running of the global economy just as much or more than the G7 nations, it made little sense to stake out new strategies or lecture governments that weren’t present to defend themselves,’’ said the Globe and Mail newspaper.
Canada chose its north-most city in the Arctic for informal chats because of its isolation. With a population of just over 6,000, this isolated city is the capital of Canada’s Nunavat territory.